
021 060 906 4 



$ V E E C li 



or 

JAMES CLARKE, ESQ. 

OF INDIANA, 
DELIVERED IN THE 

CONVENTION, 

To Amend the Constitution of Feiinsylvania, 

ON THE FIRST OF DECEMBER, 1837. 



IN SUPPORT OF AN AMENDMENT TO PROHIBIT BANKS FROM ISSUING NOTES 
OF A LESS DENOMINATION THAN TEN DOLLARS, FOR THE PRESENT, AND 
LESS THAN TWENTY DOLLARS FROxM AND AFTER THE YEAR 1842. 






PHILADELPHIA, 
PRINTED BY JOHN WILBANK, 

No, 3 Shoemaker SJpAg^V^ °V/ 




1837. 






FOR 3ALE AT THIS OFFICE— miCE G CENTS. 



i 



SPEECH 

OF 

JAMES CLARKE, ESQ. 

ON THE ISSUE OF BANK NOTES 



Remarks of JAMES CLARKE, Esq., of Indiana, rule of the house. The party to which 
delivered in the Convention, to amend the np hplono-pd had npvvr rallprl rhp wp 

Constitution of Pennsylvania, on Dec 1,1837, . Deion g ec f naa nevei caiiea tne pre- 

in support of an amendment to prohibit banks V10US question before the subject was 

from issuing notes of a less denomination than fully discussed. Fair, open and honor- 

^3r£^m ntWeaty able debate ought to be allowed, and 

Mr. Clarke of Indiana said he had fair f e P orts should be made of what 

desired to be excused from discussing gentlemen say, but he was sorry to ob- 

this question at present, as he was un- se ™ e that r som u e °J the P^y^hners 

well and not prepared to do it ample wh ° wnte f ° r the Conservative presses 

justice. He had hoped that some gen- lv \ this city had attacked, misrepresent* 

tleman more competent to the task, ed, ^nd annihilated his friend from Sus- 

would have taken the floor; but inas- Q^hanna, (Mr. Read,) and they might, 

much as the question was about to be P erha P s ' atta ^ and annihilate all who 

taken, he yielded to an imperative sense we fj °? po ^ d *°*w t^' l SUP ?° Se ' 

of duty to deliver his sentiments on the ^ ?**' C '> that he £™ we . Ti lea ™ 

subjeet. He knew not how soon free Philadelphia these scribblers will not 

discussion might be arrested by a call Ieave , ° f ™ a s "?,f le vestl Sf m ° re ^ 
for the previous question. Gentlemen was Ieft of the Kilkenny cats after their 
of the conservative party had lately n S nt - 

become very familiar with the previous He was surprised to see the President 
question, and had arrested debate on and other gentlemen of the Convention 
some very important questions, (said exhibit such warmth of feeling on the 
Mr. C.) by putting the screws to us ; bank question. He could only account 
and the previous question might be for it on the principles of the old proverb 
again sprung upon the Convention be- that " the truth bites sore." In some 
fore they were aware of it. He depre- observations which he had made at 
cated such a use being made of that Harrisburg respecting the manner in 



which the United States Bank of Penn- levellers, agrarians, 'locofocos' and other 
sylvania obtained its charter, he had such names. He knew that they were 
said that the act was passed with inde- accused of agrarianism,desiring to equal- 
cent haste. To this expression the ize property, &c, but he denied that 
President of the Convention had taken any such thing was desired by any of 
exception, and had taken him to task them. They were not so radical as 
for speaking so disrespectfully of the that. They only went so far as the 
Legislature and of the Institution. He Declaration of Independence, which de- 
had hoped that the worthy President clares all men to be born free and equal, 
had said all he wished to say on that He did not say that all men were equal 
subject, but to his surprise, he found the in intellect or industry, but that they 
President in his remarks of yesterday, ought to be so politically : they are 
harping on the same string. That ex- equal in their inalienable rights, and he 
pression, indecent haste, seemed to be wished to protect the people in the en- 
an indigestible one, and stuck in the joyment of these rights. 
President's stomach. He had used the The question before the Committee 
expression because he did not think of was whether the banks should be re- 
a milder one, and although he had been strained from issuing small notes. It 
sorely belabored on this account, yet was proposed by the amendment before 
he was prepared to say, and would now the Committee to prohibit them from 
say, that the passage of the act charter- issuing notes under ten dollars, for the 
ing the United States Bank of Pennsyl- present, and under twenty dollars after 
vania, was the most outrageous and high the year 1842. It must be conceded 
handed act of tyranny and aristocracy by all honest men that abuses had grown 
which he had ever witnessed. He knew up under the present banking system, 
the risk he ran in speaking against that and that some restriction was necessary, 
bank, or any other bank, in this place. He was very sorry to hear his friend 
But being a free representative of a free from Chester (Mr. Bell) declares that 
people, from a mountain district, he was he could not vote for this amendment 
not afraid to * beard the lion in his den' because it was insufficient to cure all 
and say those things of banks and bank- the evils appertaining to the present 
ers which he thought they merited, even system of banking. It was not proposed 
in this city of brotherly bankers. as a remedy for all the evils of banking. 

The subject (said Mr. C.) is of im- The amendment that had been proposed 
mense importance not only to ourselves the other day to make stock-holders 
but to posterity, not only to our own liable in their individual capacity for the 
State, but to the Union and the world, debts of the Company was offered as 
He acknowledged his inability to do one correction, in part, of the evils we 
the subject full justice, as he was no suffer, and this amendment was offered 
lawyer, nor w T as he a public speaker ; as an additional safe-guard. He was 
but he had the honor to represent four sorry that the Convention had thought 
counties which, he was happy to say, proper to negative the first of these; 
contained no bank ; nor was there a and the declaration of the gentleman 
bank in any adjacent county to the from Chester made him apprehensive 
South, West, or North of the district he that this might share the same fate, 
represented : he could therefore speak These amendments were intended only 
his sentiments with entire freedom, and as the pannels of a fence, which, when 
he hoped with impartiality. followed up, might make a complete en- 

The party with whom he had the closure, so as to hedge in the lawless 
honor of acting were accustomed to manufacturers of rag money. Our 
have their motives and principles mis- President has deprecated the throwing 
represented. They were called jacobins, of the fire-brand of party among us. 



He (Mr. C.) had observed that the con- tions are radically wrong. They are 
servatives had been rallied by the gen- against the genius and spirit of our free 
tleman from Beaver, and he regretted institutions. They are unequal, unjust, 
that party spirit hail, apparently, blinded and fraudulent: unequal because they 
the " whigs" and Antimasons to all the make distinctions among the citizens 
evils of the banking system; but it was who ought all to possess the same op- 
vain to reason with men whose politi- portunity of advancing their interests ; 
cal system is based on avarice: "for unjust, because they give advantages 
the love of money is the root of all evil." to a favored few that are denied to all 
Avarice, Mr. Chairman, is the most in- others; fraudulent, because they take 
curable vice of the human heart. Ava- the power from the many and give it to 
rice is the vice of old age. We have the few. Should a few designing men 
seen, and heard, and read of many in- ask the legislature for a donation in 
stances of prodigals being reformed, but money without equivalent, it would be 
it is a remarkable fact that there is no immediately refused, as all would see 
account in sacred or profane history of that any sum taken from the treasury 
a miser having ever repented. Men, would be drawn from the pockets of the 
(said Mr. C,) were originally created people; but the same men ask for a 
equal in rights and privileges, but that charter of incorporation under some 
equality had been destroyed in all coun- plausible pretext of public good by 
tries and in all ages, by force or fraud, which they can realise the same amount. 
Savages and barbarians used force If the charter be granted, it is equally 
in despoiling others of their property ; true, though it may not be so readily 
while fraud was resorted to in civilized perceived, that the people, the whole 
communities. The simple, the honest, people are divested of their rights 
the unsuspecting have been defrauded to the extent of the favor or privi- 
of their earnings, and of their rights, by lege included in the grant. Such char- 
kings and nobles, demagogues, quack ters are therefore fraudulent and unjust, 
doctors, pettifoggers and speculators of Another objection to corporations for 
all grades and conditions. The gentle- money making purposes, is, that they 
man from Philadelphia, on his right, (Mr. are monopolies, such as the corrupt 
Biddle,) deprecated this constant chang- monarchs of the old world have been in 
ing ; but, sir, this cry against ehange.is the habit of bestowing on their favorites, 
and has been in all ages and all coun- Our coal companies, companies for mak- 
tries the war-cry of those who are for ing coke, and for other business objects 
perpetuating abuses. But in the march are of this kind. They are also objec- 
of civilization and the progressive im- tionable because they are perpetuities, 
provement of mankind in government, and as such they render nugatory our 
changes become necessary to secure to wholesome laws for the distribution of 
the productive classes their inherent estates, and those forbidding entails, as 
rights, and to restore to them those of through them property was handed 
which, they had. been divested by force down from one generation to another, 
or fraud. He therefore gloried in stand- They are an aristocracy that will natu- 
ing there as the feeble advocate of such rally and necessarily create and per- 
a change in our present pernicious bank- petuate abuses. It is true the stock- 
ing system as will have a tendency to holders may die, or be changed, but 
restore their lost rights to the produc- the corporation still lives ; and whoever 
tive classes of society. has the management of such corporation 

It may be necessary, Mr. Chairman, will use all the power transmitted to 
to make a few observations respecting them or within their reach ; — for man 
corporations for money making pur- is seldom known to relinquish power, 
poses. In a free country such corpora- and is generally indisposed to inquire 



into the justice of its origin. Ay sir- Corporations (said Mr. C.) are of 

Sm C) such corporations are several kinds :- 1st, those ; for civil pur- 

aristocracies of the worst kind. If we poses, such as incorporating cities and 

mus ^ave an aristocracy he prefered boroughs. Against. this kind there can 

one of noble blood-even though their be no objections they are necessary foi 
one or nooie oiu ^ ^ ^ ^ ^ poUty Qf the goverment 2 d. 

"Had crept through scoundrels ever since thQse ^ re ljgious, charitable, and llte- 

the flood." nurooses ; these are also necessary, 

Or a nobility whose warlike ancestors aiypu r, oses t funds ^ 

carved out their titles w lh their swoid. ^^""L^ of the institution.. 

He wished to shun all aristocracies but S» specmc o^e 

above all, the cent per cent Shy ock *£*£*% Turnpikes, Bridges, 

aristocracy, which i wou always^ g*-jj£ ^ Canal3 ,_ justifi ab>e, 

the pound of flesh if they could B et when the objects are beydnd the reach 

"' . ., J .-„„ h» hflfl to such of individual enterprise, and because 
Another objection lie had to such highways that gov 

corporation, was their ter^ency t mu - toey are p ^ ^ .^ for ^ 
tiply drones in society. Mr. Chan man, corporations he had men- 

(said he,) if you have ever kept bees ^ The ™,*>i distributio n 

you must «-e observed that young *gf*£ yel , of goverm ent to 
hives have no drones, but old hues, no we ii founded objection could 

which have many drones cease tc .be ^ b e ^.except thaf the officers 
productive of much good; forjudging I v col . porat ions sometimes use 
from the size of the drones, it is proba- "?,»£ brief authority" in a man- 
ble they consume twice as much honey ^J****^ citizel f s . sir. (S aid 
.as the same number of ^working ;bee * - v c e ™ rations for mone y making 
If a hundred men be associated toge h- D0S i ar £ detestable. Theirtendency 
er, and all divide the labor equally pu P ^ e d ^ents ; and thus make 
among them, a moderate .quantity of * to ^rat f F ab n orers , ' and tyrants of 
labor would sustain them bu, lf twenty ^'^ ab ° f su ' ch corporat ions. 

of the hundred «^*£*£Z They e ve to extinguish the spirit of 
wits, and consume or destioy twice as > who are in 

nuchas the same — °^^ hTpower subservient to their witt 
it must be evident that the •emainin f Let those acquainted 

eighty producers "»»* J^ ^ wi h our Iron works answer. He knew 
more than if all were to do then pio Iron-masters were 

portion. This with me, sir is an in- ^^n^ost worthy citizens of the 
superable objection against a corpora- ^f^^everUmetSes wit- 
tions for money making purposes, it > dftheardofthe hands em- 

is a fallacy to say that corporations ere, ^d at Iron wo rS having been taken 
ate wealth. Labor and labor alon** ployed at Iron wort ^ ^ ^ 
the source of all wealth. It is a mis j automatons to put in their 

statement of terms to say that corpora- ^ M ^e Wished to eee the bounds 
tions give the laborer employment. La- "*£j£ ™ s0 tnat ev ery man 
bor, which produces all, gives to cor- ot '^edom ema i^e ° freeman , H e 
portions theirprofits. Labor provides con d fee that he «as a fieeman. 
our food, procures ns elothmg, bndds a*ed if it ^ was denied ^ ^ ^ 
our houses, and gives to us all the com- fisted »boui« yote as 

forts and benefits which we receive pi 0/*™ ° de, to m ^ 

from man. Industry not only creates the ban ^^ b ^f e ,LL h wea lth and 
the wealth and adds to the happiness* ^"X^f English manufactures, 
society, but it also conduces to health he plendo he0 = erativesunde r the 
and sood morals. 



English factory system, who are ever who suffers) Let me mention one or 
dnthe verge of pauperism. Such sys- two examples. Some twenty years ago 
terns cannot produce freemen. They before the turnpike roads were comple- 
may produce and concentrate wealth ; ted over the mountains, when mush- 
but wealth acquired in that way has room banks sprung up like Jonah's 
been there, and will be here, often used gourd in a night, the laborious wagoner 
for corrupt purposes. But a yet more toiled through the mud and delivered 
iniquitous feature in such corporations goods in Pittsburg for seven dollars a 
was a legal exemption of the stock- hundred, receiving his reward in rags 
holders from liability forjthe debts of the* that would not pay his toll fifty miles 
company. Such exemption violates a east of Pittsburg. At that time a few 
fundamental principle of our nature : merchants took it into their heads that 
for profit and responsibility were the the wagoners were charging too much 
original condition of our being. It is for hauling: they therefore formed a 
said in Divine Writ, "In the sweat of thy transportation company, and obtained 
faceshalt thou eat bread." Bread is from the legislature an act of incorpora- 
the profit, and sweat the responsibility, tion. This company, sir, for some time 
It is wrong, therefore, for legislators to went on swimmingly. They injured 
attempt to separate them. This exemp- the honest wagoners for the time being, 
tion,sir,isabullofmdulgencetoauthor- but at the end of eight or nine months 
ise lying and the commission of fraud failed, leaving their creditors to suffer a 
with impunity. It is a passport to en- loss, ( as I have been informed ) of about 
able men of sinister designs to prey a hundred thousand dollars, 
upon the fruits of t - labor,— to make the Some fifteen years since a few far- 
rich richer, and the poor poorer. It is mers in Chester County, without ad- 
a legal cloak to cover the speculator verting to the law of demand and sup- 
fromTthe consequences of his own im- ply, took it into their heads that the 
prudence. Cloaks, sir, have been worn brewers of this city did not give them 
for many purposes:— enough for their barley : they, therefore, 

"And for a mantle large and broad established a brewery of their own, and 

"He wrapt him in religion." obtained from the legislature an act of 

This corporate exemption is a mantle to incor p 0ration . A few ye ars were suf- 
cover political deceivers. "We have Mr. fldent to wind this concern also> 
Chairman, companies incorporated for butj it is believed, without much loss to- 
all purposes ; for digging coal; for ma- the pubIic> A simi]ar catastrophe hap _ 
king coke; for building a tavern herein d to a company of farraers in 

this city; and even a blacksmith shop Westmoreland county, who established 
m Chambersburg obtained the- honor of a joint stock store> These |ast how- 
an act of mcorporation; and if they are were unmcorp0 rated, and were 

permitted to proceed without restriction, therefore liab]e for what debtg th 
they will in time monopolize all the pro- mi ht contract These cases have been 
fitable business of society. Yes sir, mentioned to show the im p r0 priety of 
they are our masters already-they granting acts of incorporation for any 
judge our judges; they govern our thi ^ttnn the reach of individual en- 
governors; and through their bor- terp ^ se 
ers they dictate law to our leg- 
islature. Nothing on earth can save lam now going (said Mr. C. ) to 
the productive classes from becoming take a nearer view of the question, and 
mere hewers of wood and drawers of to examine the subject of Banks and 
water to the monopolists but the Banking. Banking, sir, modern bank- 
awakened energies of a free people, ing, I hold to be a device of Satan. It 
But, sir, these corporate bodies some- contains within it all the evils inherent 
times fail, and when they fail, I ask you in other corporations for money making 



8 

purposes, and also the gambling and to be a few merchants in our cities who 
swindling principles oflotteries. These have overtraded. This community, sir, 
may be harsh terms, but is it not noto- reminds me of the observation that 
rious that modern banking promotes " Boston is Massachusetts, and Massa- 
gambling[in stocks; in goods ; in western chusetts is the United States." But how 
wild lands ; in town lots; and in cities was the community to be ruined 7 
on paper, to the detriment of lawful in- Why, a gentleman from the city, on 
dustry? Banking also swindles society my right, (Mr. Biddle) says, if the banks 
by producing fluctuations in the value of Pennsylvania had not stopped pay- 
of the currency, and the refusal of the ment, they would have been stripped of 
banks, last May, to pay their debts, has their specie; and permit me to ask of 
the character of swindling. Bankers what use has that specie been to the 
<iould increase or diminish the currency at public since the 10th of May 7 Strip- 
pleasure: was it too much to believe that ped of specie, indeed! As well might 
they did so to promote their own in- the specie, for all the benefit the public 
terests? There were two things for have received, have remained in the 
directors to consider. — 1. To make mo- mines. The wholesome maxims of 
ney for the stockholders. 2. To make private life can never be violated with 
it for themselves The last was evi- impunity. If it be morally wrong for 
dently the greater object, and would be an individual to refuse to pay his debts, 
first attended to. Modern Banking, while he has specie in his possession, it 
sir, is not exactly the philosopher's is also wrong for incorporated bankers 
stone, but it enables the bankers to to refuse to pay theirs. It may be ob- 
transmute the sweat of labor into oil jected that by paying it out, the specie 
and wine, and milk, and honey, for their would have left the country. This I 
own benefit. Our president has asked deny. Had it not been for the "Shin- 
what the banks gained by this suspen- plasters," first issued by this city and 
sion 1 I answer they have gained what followed by this city's imitators through- 
all dishonest or insolvent men desire, out the country, necessity would have 
they have gained time. But, sir, they ap- kept the specie in the country and in 
pear to have gained more than time, for I circulation. I can here give youj the 
observe that since the suspension they example of the village in which I reside, 
have been making large dividends of 4 and . the neighboring country. The 
to 6 per cent on their nominal capi- citizens of Blairsville determined at a 
tal for the last six months. Now, public meeting, early in the season, that 
sir, if any other than a banker should they would neither issue "Shinplasters" 
loan his money at more than 6 per cent nor give them currency. What, then, was 
per annum he would be punished un- the consequence 1 Why, that we al- 
<ier your laws for usury ; but your ban- ways had specie change, a little scarce 
kers, sir, are allowed to divide 8, 10, and at first while the panic lasted, but, lat- 
12 per cent, and that too at the time terly, nearly enough for all the purposes 
they refuse to pay their debts in the of life. It is demonstrated that the spe- 
constitutional currency of the country, cie could not have left the country, be- 
Our president says the community cause the value of specie, as of evejy 
would have been ruined if the banks thing else, increases with its scarcity, 
had not suspended. What community, and when the scarcity enhances the 
pray 1 Not the farmer, nor the me- value to the point of exchange it must 
chanic, nor the laborer ; no sir, none of cease to flow out of the country. The 
these : for in the part of the state where banks ought to have paid as long as 
I reside panics and pressures have been they were able, and then we should have 
known only through the medium of had plenty of specie in circulation. I 
newspapers. The "community," I take object, sir, to banking because it en- 



courages the violation of the moral 
law. One injunction of the Apostle Paul 
is "Oweno man any thing." But 
banking, in opposition to that precept, 
encourages the contraction of debts. A 
direction of the wise man, is, "Be 
thou not one of them that strike hands 
or of them that are sureties for debts," 
but it is a principle in banking to re- 
quire surety. How many thousands 
have been ruined by indorsing notes for 
discount in bank! Even our mo- 
dern novelists and dramatists when 
they wish a hero reduced from wealth 
to poverty usually represent him as 
bailing a friend. — And why, sir, are so 
many ruined by bailing'? Because, sir, 
it is a moral evil: a special curse seems 
to follow the transaction. Another ob- 
jection ( said Mr. C. ) which I have to 
the system is that your bankers are 
wholly irresponsible; the individual 
stockholders cannot be sued for the 
debts ofthe concern, and what in- 
dividual, let me ask, can contend with 
the bank itself? Those who are near 
to it are deterred by the dread of its 
influence, and those who are far 
off cannot leave their homes to prose- 
cute it for its broken "promises to pay." 
Banks, sir, are lawless. Witness their 
defiance of law since last spring. And, 
strange to say, they have found sup- 
porters and defenders in that party who 
are great sticklers for the "supremacy 
ofthe laws and the constitution," — that 
party who shed oceans of crocodile 
tears over the fate ofthe poor Indians, — 
and many of whom with equal sincerity 
wail over the manacles ot the negroes, 
■ — a party who are horrified at all ap- 
pearance of Lynch law, but who can 
look on with complacency, and even 
defend the lawlessness of the banks. 
I am, sir, against all violation of law, 
whether by Judge Lynch or by the gen- 
tlemen bankers. Our president has 
deprecated in strong terms the remark 
ofthe gentleman from Susquehanna,(Mr. 
Read ) in calling the bankers conspir- 
ators, and said that the banks were con- 

B 



ducted by honorable men. Honorable 
men ! What, Mr. Chairman, is the 
standard of honor 1 I have heard of the 
honor of duellists, and the honor of 
gamblers, and I have even heard of 
honor among thieves; and Sir John 
Falstaff has given us his definition of 
honor: — yet I am at a loss to know 
that standard of honor by which bank- 
ers regulate their conduct in refusing to 
pay their debts. It has been said that 
"shame is as a man takes it;" the same 
perhaps may be said of men's notions 
of honor. But, said the president, they 
cannot have been guilty of conspiracy 
because they are honorable men. In 
Mark Anthony's well known harangue 
it is said that those who slew Cesar 
were " all honorable men" and yet those 
honorable men were conspirators. The 
Bankers were said to be honorable 
men. I, sir, judge of men's honour by 
their actions. I cannot call it ho- 
norable for men to league together 
to shun payment of their just debts. 
Our president professes to disbelieve 
the statement of the gentleman from 
Susquehanna (Mr. Read) respecting 
the Susquehanna Bank violating the law 
of its creation in depositing its first in- 
stalment in a broken bank: and why 
does he doubt it ? Because a dear bank 
has been detected in the very act 
of violating the law; and, he, as 
a lawyer, knew that the best point 
in the law, under such circum- 
stances, was, to deny the fact. 
But as they are both lawyers I 
will leave that matter between them. 
Let us now inquire what are alleged 
to be the benefits arising from banks. 
I suppose the friends of banks will 
say banks lend money, and also 
keep the money of others safe on 
deposit; and, also, that they fa- 
cilitate" exchanges between one district 
and another. They are, I believe, also 
held to be useful as reservoirs of credit. 
These, sir, are the principal uses claimed 
for banks. Let us examine these 
things, a little, in detail ; and first,— I 



12 

i ron cannot 1)0 manufactured under fectual by many, i:; a limitation of thf 
$125 or $130 per ton, thus giving the dividends or profits in banking. If the 
foreigner an advantage in our market, bankers are not allowed to divide more 
even after paying the duties imposed per cent, on their capital, than honest 
for protecting American labor. It is, men are permitted to lend their money 
therefore, obvious that the increase of for ; say six per cent per annum, (or 
the paper currency counteracts the ef- say 7 per cent, to cover contingencies) 
feet of the tariff for benefitting our own then inducements to over issues would 
manufactures. The same reasonings be taken away ; for they would not be 
apply to mining. Why is coal brought likely to extend their business beyond 
from Halifax and Liverpool when the the dividend allowed by law. But, in 
mountains of Pennsylvania contain my apprehension, the most effectual cure 
enough to supply the world ? *A sound for the evils of which we complain, would 
currency, free trade, and moderate pro- be the amendment now before you, pro- 
tection are all we require to cause our hibiting all banks from issuing notes un- 
mining, manufacturing and agricultural der $10 immediately, and under $20 af- 
interests to flourish despite of foreign ter the year 1842. The amounts pro- 
competition, posed are those which have been gene- 
One of the most obvious evils, Mr- rally proposed through the democratic 
Chairman, of this pernicious banking press of the State, and they have my 
system, is the constant tendency to ere- hearty approbation so far as they go to 
ate a redundant currency, and thus to remedy the evil; but I must acknowl- 
lead men from sober habits of industry edge that my individual opinions are 
into wild schemes of speculation, landing yet more radical on this subject. I 
them, after a career of extravagance, in would be willing to prohibit the circula- 
insolvency. That the present banking sys- tion after a few years, of all bank bills 
tern is productive of a long train of evils, under $50 or $100. My reason, sir, is, 
is undeniable;— evils, in my opinion out- that as you forbid the circulation of 
weighing all the advantages claimed for small bills, you increase that of specie 
it by its friends. It becomes a serious in the same ratio. I have an ardent de- 
enquiry, whether they are evils that ad- sire to saturate the country with specie, 
mit of cure, and if so what remedy is that the farmer, the mechanic, the labor- 
likely to be effectuaH Many restric- er and the small dealer may transact all 
tions have been proposed, deemed more business in a solid currency, having the 
or less efficacious ; but the most effec- faith of the whole world for its support, 
tual would be a liability of the stockhold- If we must and will have paper, I wish 
ers for the debts of the concern, a iimi- to see such a basis for it, as will pre- 
tation of the issues, and a limitation of vent fluctuation. But. it will not do to 
the dividends. I am sorry that the first keep that basis in the banks, for expe- 
proposition of the gentleman from Sus- rience has shown that the more specie 
quehanna, (Mr. Read) to make stockhol- they have in their vaults, the more they 
ders of banks liable for the debts, was inundate the country with paper. I, 
voted down, by a majority of this com- therefore, wish to see specie not in the 
mittee. Had that proposition prevailed, vaults of the banks but in the hands of 
it would have secured the caution and the productive classes of the community, 
prudence of individual responsibility It is needless to add that specie and 
necessary for the economical prosecution bank paper of the same denomination, 
of every business in life. The best will not circulate together. This is 
guarantee for prudence is a liability to shown by the "shin plasters" driving 
the penalty of loss following misman- the specie change from circulation 
agement. Another remedy thought ef- Why is it that gold has not circulated " 



13 



Is it not because no man will pay $5 or 
£10 in gold, as long as he has a $5 or a 
$ 1 note to give ? But gentlemen say it 
is the business of the Legislature & not of 
the Convention, to make these restric- 
tions. The gentleman from the city on 
m_v right, (Mr. Biddle) is against any re- 
strictions on the Legislature, & the gentle- 
man from Franklin, (Mr. Chambers) is 
also disposed to leave the subject to the 
discretion of the Legislature; and our 
worthy President (Mr. Sergeant) de- 
precates mistrusting the representatives 
of the people. Now, sir, I beg leave to 
differ from these gentlemen. I disavow 
all unnecessary reflection on our law 
makers, but duty compels me to state 
that our Legislature, if not the most cor- 
rupt, are at least the most accessible to 
importunity of any of the branches of 
our government. It is well known, sir, 
that crowds of interested applicants at- 
tend at Harrisburg every winter, and 
that those applicants contrive to procure 
the passage of laws for selfish and sinis- 
ter purposes. They are familiarly called 
"middle-house- men," " lobby-members," 
or "borers." It is to guard our Legis- 
lature from the importunities of such 
men that I wish to see wholesome re- 
strictions on banking in our Constitu- 
tion. The gentleman from Franklin has 
also objected that if our own banks are 
prohibited from issuing notes under $20 
we will be exposed to notes of other 
states, and inundated with other bank pa- 
per, over which we have no control. This 
sir, was the argument used against re- 
pealing the lottery act granted to the 
Union Canal Company, that for a long 
time disgraced the statute book of Penn- 
sylvania, and demoralized her citizens. 
It was then urged that if we had no lot- 
tery of our own, that lottery tickets from 
other states would be sold as readily as 
ever, and thus carry out of the state, the 
money that ought to be retained in it. 
But the moral sense of the community 
triumphed. The Union Canal Lottery 
was repealed. The sale of lottery tick- 



ets of other states was forbidden under 
severe penalties, and we have the satis- 
faction to know that no lottery office is 
kept openly in the Commonwealth. Just 
so will it be with the bank notes of the 
forbidden denominations. They can by 
legislative enactments be entirely ex- 
cluded from circulation. We had simi- 
lar predictions, sir, when the law was 
under discussion in 1828 for prohibiting 
the circulation of the one, two and three 
dollar bank notes ; but that bill became 
a law, the prohibited notes went out of 
circulation and Pennsylvania abounded 
with silver change, while the neighbor- 
ing states of Ohio, New York, New Jer- 
sey and Delaware, were overrun with 
paper trash. I apprehend no difficulty 
from the insertion of the prohibition into 
the Constitution. If the former act fil- 
led the state with silver change, the pro- 
posed prohibition would also fill it with 
a gold currency. Here let me notice 
one or two objections. It is objected by 
the friends of the present banking sys- 
tem, that there is not specie enough in 
the ^country. To this I reply that coin 
is but a measure of value. A*dollar is 
our unit for measuring value, as a pound 
is for measuring weight, a gallon for ca- 
pacity, or a yard for length. With this 
difference alone ; the measures of length, 
weight and capacity are kept stationary 
by the dealer, while in the case of the 
measure of value, the measure itself is 
handed over as an equivalent. But, sir, 
the bankers have invented a, false and 
fraudulent measure, as false, as false bal- 
ances which are severely denounced in 
Holy Writ. Your paper system may be 
compared to a yard stick composed of 
gum elastic, which can be expanded or 
contracted at pleasure. A dealer, sir, 
with such a measure must be very defi- 
cient in tact or shrewdness if he can 
not keep himself safe, let who will suffer. 
But, sir, a word or two concerning the 
scarcity of specie. It is of little conse- 
quence whether a day's wages of labor 
be represented by a dollar, by 75 cents. 



11 



or by ">0 cents, provided all other tilings 
which the laborer may wish to procure 
be in the same proportion ; hence the 
specie now in the United States will 
serve as well for measuring value as if 
it were double or treble the amount ; 
but if it is in less proportion than in the 
rest of" the world, specie will flow to us 
from other countries, for money like wa- 
ter will find its level. Again, sir, gold 
and silver are produced just as you pro- 
duce salt or iron. Increase the demand 
and you increase the production. When 
iron falls in price, our furnaces go out 
of blast. When iron rises, more iron- 
works are put into operation. When the 
price of salt is low, those wells on the 
Kiskisminitas which yield from nine to 
fourteen barrels of salt in twenty-four 
hours, can alone be worked, but when 
salt rises, four or live barrel wells are 
brought into requisition. Just so will 
it be with the gold mines in the South- 
ern States. If you increase the demand 
for gold, mines of less value will be 
worked, while those mines that now 
yield a profitable return for the labor 
required, will be worked much more ex- 
tensively. I think, sir, that a former 
Secretary of the Treasury, stated in one 
of his annual reports to Congress, that 
it would require about $11 for each per- 
son in the U. States to give a suitable 
amount of currency. We number at 
this time perhaps, about 16,000,000. 
We ought, therefore, now to have about 
$176,000,000. I believe it will be con- 
ceded that there is now, or at least was 
last May, when the banks stopped pay- 
ment about $80,000,000, in gold and 
silver, in the country. We have there- 
fore but to double this sum to have 
nearly the amount required. This can 
be done, if necessary, in eight or ten 
years, without embarrasment. 

Permit me, Mr. Chairman, to call the 
attention of the Committee to another 
evil of our present banking system : an 
evil that I deprecate, and dread the con- 
sequences of, more than any that has 
yet been mentioned, and that is, the ten. 



dency of banks to interfere with the po- 
litics of the country. This is a deplora- 
ble evil. It has within a few years pro- 
duced a state of political feeling and an- 
imosity between the parties, and among 
neighbors, such as has not been witness- 
ed since the black cockade times of 
high toned Federalism in '98, excepting 
the blue light toryism of the last war. 
The gentleman from the city (Mr. Bid- 
die) has spoken of the warfare of the go- 
vernment against the institutions of the- 
country. The warfare of the govern- 
ment against the institutions, indeed! 
What institutions] The United States 
Bank; a creature of its own creating. 
Sir, the gentleman is in error in calling 
it a war of the govrnment. It was, sir, 
a desperate and reckless war of that 
overgrown corrupt institution for a pro- 
longation of its existence and exclusive 
privileges. Instead of quietly submitting 
to the laws of the country and suffering 
the charter to expire according to the 
wish of the majority, the managers of 
that bank convulsed the country from 
the centre to the circumference, by a 
system of expansions and contractions, 
panics and pressures,and poisoning pub- 
lic opinion through the medium of their 
hired orators and stipendary presses. 
But, sir, the efforts of the people through 
their executive, to conquer this monied 
leviathan has been modestly called by 
our president (Mr. Sergeant) "executive 
usurpation begun in 1833;" and he has 
also told us that " that there are now 
400,000,000 capital and 800,000,000 
debts and credits belonging to the banks 
of the United States, of which the go- 
vernment wishes to deprive them." 
What an awful government we must 
have! Worse than the grand Turk, or 
the autocrat of Russia ! Who would 
believe it ! That our rulers elected by 
the people should seriously wish to de- 
stroy all the monied institutions in the 
country 1 I certainly should not, had I 
not been told so by our honorable pre- 
sident; nor can I yet believe it, not- 
withstanding the authority. It is not so. 



15 

President Jackson, iike those who elect- that banks are necessary. I am not so 
ed him, only wishes to stay the encroach- U Utopian as to imagine that we ought 
ments of the money power and to more to destroy all banks immediately, or that 
effectually secure the liberties of the the evil can be cured in a short period, 
productive classes ; and Mr Vail Buren Banking is like a cancer. It has struck 
wishes to separate the government from its roots into the vitals of society & seems 
the banks, and to suffer the banks and incapable of immediate cure without 
bankers to manage their own affairs in endangering the body politic. 1 there- 
their own way without giving them the fore only hope for some present amelio- 
taxes raised from the people, as a fund ration from the worst evils, and a grad- 
to speculate on. But our president (Mr ual cure -of the disease as time and 
Sergeant) consoles himself with the opin- opportunity may offer. The present 
ion that the high handed measnres which amendment which proposes the ultimate 
have been enacted by thistyranical gov- restriction of any issue below $20 will 
ernmentof ours, and those which it pro- go far to remedy some of the worst 
poses yet to enact against the interests evils. It will leave bank notes of the 
of the people, will be put a stop to. He large denominations for the use of mer- 
tells us that '-every where the voice of chants and traders, and will provide a 
the people is heard against their despoil- sound specie basis for the wages of la- 
ers." 1 know, sir, that the friends of the bor. But, sir, if we have no other rem- 
bank have had a recent triumph in the edy, 1 am half inclined to believe that 
state of New York; but how, let me we must adopt the method resorted to 
ask, has that been effected! Was it not in new countries to stay a conflagration 
that the speculators operating through in the forest, that is, to combat fire with 
their democratic Legislature, succeeded fire. I mean by making banking a free 
from time to time in inundating the state commercial business, open alike to all 
with banks combined on the safety fund who may embark in it and comply with 
system; and that these banks true to the requirementsimposed bylaw. Such 
their principles, united with the aristoc- a system with severe penalties and re- 
racy against the government of their strictions may after all, be found most 
country, when it was proposed to with- beneficial, but in such cases pecuniary 
draw the people's funds on which they penalties ought to be imposed on stock- 
speculated. Sir, the bankers seem now T holders, and the managers of such insti- 
to be in ecstacies with the result of that tutions ought to answer criminally for 
election, and however paradoxical it violating the restrictions imposed bylaw, 
may appear, I also am pleased with the I believe that this system is not new. 
result. I am pleased because it will It is practised now in Europe with ad- 
teach the democrats of New York and vantage to the community. It would 
of the Union, how dangerous is a mul- have at least one good tendency, to 
tiplication of banks, and how little trust make banking purely commercial and 
is to be placed in bankers. I have known to separate it from politics. The pre- 
several instances in this state, where de- sent system of chartered companies lead 
rnocrats were induced to procure an act those who wish to get a new charter, or 
of incorporation for a bank and the in- an old charter renewed, to take an active 
stitution afterwards fell into the hands part in the politics of the dictrict, in or- 
and under the control of their opponents, der to secure representation agreeable 
I have always rejoiced when they got to their designs. But if men embark 
rapped across the knuckles for having into banking, as into other pursuits, un- 
any thing to do with these shaving der a general law, there would be no 
shqps. In the present condition of soci- inducement for bankers to make com- 
ety it appears to be generally conceded mon cause, to elevate one party and 



i 



LIBRARY OF CONGRESS 



Sfw see the present amendment 

full of the precious metals. What, let me 
«k would be the consequence if a war 

should be in circulation, we couWsu^ 
tain a war for several years, and ma 
pecuniary view scarcely perceive the 
eft>c"s One case may be compared to 
a man who is compelled to go o ma^ 

ket to obtain provision for he day , 1* 
other to a farmer with well ffl led ba ns 
and granaries, sufficient to sustain him- 
self and neighbors throughout the year. 
L Ut not beobjected that Pennsylvania 
cannot accomplish this. It .s sufficient 



M 

0^021 060906 4 the benefi t 

will be "so apparent that others will fol- 
low the example. When that takes 
place we shall hear no more of fluctua- 
tions, and panics, and pressures. Eng- 
land is frequently convulsed by these re- 
vulsions in commerce, owing to her pa- 
per system ; while we hear but little of 
them in France which is, and always 
has been, a hard money nation. 

I have, sir, detained the Committee 
longer than I oxpected when I rose to 
address you. While I hope that some 
of the Antimasons may rise superior to 
party and vote for this amendment, I 
must say I do not believe they will: 
such is the difference between faith and 
hope. The evidences that I have seen 
of their attachment to the banks, com- 
pel me to fear that they will vote against 
all restrictions. 



